Loyal customers spend over 65% more than new customers, according to one report. That’s not an incredibly surprising fact. But what creates customer loyalty probably isn’t a reward program. Except for a few standouts – airlines, for example – most retailers or companies have failed to get their loyalty programs off the ground. This is due to a combination of factors that include the rewards not being relevant, the process being too cumbersome, and a general feeling that our time is worth more than the small savings or reward being offered. There’s no question that customers like to earn rewards, but there is a crossroad where the desire for a reward and the reward’s appeal intersect, and that intersection is called “convenience.” An evolution that’s arisen out of digital reward programs is making getting rewarded as convenient as possible, while also – in a welcome twist – vastly expanding what qualifies as “rewardable.” The idea is simple, but genius.
Almost everything you buy comes with a receipt. Buy a physical book or an e-book, get some food for the dog at the grocery store, or buy it online… all these purchases can be translated into a goldmine of info for big data. That data is valuable… but how can you get it from consumers? Reward apps have cracked the code by figuring out what consumers want: a wide degree of reward choices, and convenience. They’ve made the process of collecting points almost hassle-free: just snap a pic of your receipt. After scanning or photographing your receipt, the app starts depositing points into your digital wallet. What’s on offer as rewards are the other reason reward apps are so appealing. One individual might decide to redeem a small number of points for an Amazon gift card. Another may choose a free ride with Uber or a Starbucks Frappuccino – these might be termed “instant gratification” options.
Other people will store or build up the points they earn in their digital wallet and later sort through a long list of reward options available from the app – specials, discounts, deals – and redeem them later. The choice is up to you, which is a massive change from the “earn 12 stamps and get a free diet soda,” or other similar loyalty programs that have been tried and rejected by most of us as they’re just not attractive anymore. Expanding the idea to include all expenditures that come with a receipt is a new notion that will no doubt be developed further and aid in the personalization of marketing and advertising.
The app, in conjunction with big data analyst agencies, aggregates all of this shopping data and turns it into actionable information. It’s a near-perfect trade that works for both sides, so much so that it’s a little surprising it’s taken this long to become popular. Actually, the idea has already taken root in some parts of Asia. But the system in say, Taiwan, is a bit more cumbersome. There you need to scan the barcode of every object you buy and fill out a small online survey, which does take some time. With new reward apps, it’s significantly simpler. All the customer needs to do is scan or snap a picture of receipts. And what about the rewards? Well, the key to getting someone to be willing to scan or photograph a receipt is a reward that has value… to that person. That’s why there are so many options for redeeming your points. A family might choose to combine their points and wait for a good discount offer on, say, a new flat-screen TV. Other people will pick gift cards. Why should a reward program only offer a couple of choices when there are billions of us, each with very different wants and needs? Everything counts and rewards are flexible isn’t rocket science, but it appears to be the exact combo that’s attractive enough to actually work.
Back in the day people happily cut out coupons and then shopped at one specific supermarket just so they could save a few bucks. But life today moves at a considerably faster pace. Most of us value our time over some small savings. The digitization process of reward programs isn’t exactly new, companies have been offering e-vouchers or e-gift cards for a while, but the big change with a reward app is inclusivity. Everything that comes with a receipt counts towards added points that fill up your digital wallet. And there’s no need to rush: you have two weeks from the date of buying something to get the information in. It might take a day or two to get used to remembering to scan receipts, but users report it becomes a habit rather quickly. Perhaps soon, with digital payment plans such as Apple Pay or Google Pay, you won’t have to scan anything. The future is here, and it’s rewarding.